California and the West

Chiron Recalls Vaccine for Kids

Chiron Corp. on Thursday recalled and withdrew a common childhood vaccine sold in Italy and several other foreign countries, compounding the biotech company's headaches as it recovers from production problems that caused a recent shortage of flu shots.

The vaccine is used in Italy, Syria, Jordan and some smaller countries that receive the drug through the United Nations Children's Fund and Pan American Health Organization.

Chiron sells Morupar exclusively in overseas markets closer to the plants that make the vaccine, said company spokeswoman Alison Marquiss.

Other drug makers supply the United States with the measles, mumps and rubella, or MMR, vaccine, which is usually first administered when children are 12 to 15 months old.

Italy determined that five patients immunized with Morupar suffered adverse reactions, including fever and swelling of the glands, Marquiss said.

The same pattern hasn't been cropping up with MMR vaccines made by two other manufacturers, prompting the Italian Medicine Agency to order a withdrawal of Chiron's product from the market.

Chiron said it provided Italy with about 450,000 doses of the MMR vaccine last year, with approximately 4.5 million additional doses going to other countries.

In a statement, Chiron described the recall and withdrawal as precautionary and emphasized there was no reason to believe that patients already immunized with Morupar face any long-term health risks.

Morupar accounted for just $10 million of Chiron's 2005 revenue of $1.9 billion. To account for the setback, Chiron will reduce its previously reported earnings for last year's final quarter by 3 cents a share to 68 cents.

Chiron's woes with its flu vaccine have been more severe, reducing the company's sales by more than $250 million during the last two years.

Chiron has agreed to be acquired by Swiss drug maker Novartis, but that deal isn't going smoothly either.

Four Chiron shareholders with a combined 17.5% stake in the company believe that the sale price is too low.

Novartis has offered $5.1 billion, or $45 a share, for the 56% of Chiron that it doesn't already own.

One of the dissident shareholders, ValueAct Capital, has threatened to lead an effort to oust Chiron's chief executive, Howard Pien, if he continues to support Novartis' bid and the offer is ultimately rejected.

A shareholder vote is scheduled April 12. Federal regulators already have approved the proposed Novartis takeover.